Another way to put this, avoiding certain ambiguities, is 'a point at which the inputs to a project are mostly its own outputs', such that improvements to its outputs feed back into its inputs.

This doesn't seem to follow. Most inputs of the system, for a very long number of time-steps (certainly before the conception of deception) will come from the external world at is learns.

The relevant inputs here are only those that will cause self improvement of the relevant kind, which would be likely outnumbered by non self-improvement inputs, such as perceptions, query results etc...